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4.2. Fiscal policy

Syllabus
0455–2027–2028
Topic
4.2
Level
—

4.2.1—Government budget

  • definitions of:
  • government budget
  • government budget deficit
  • government budget surplus
  • calculations of the size of a government budget deficit/surplus

4.2.2—Reasons for government spending

  • main areas of government spending and the reasons for and effects of spending in these areas

4.2.3—Taxation

  • reasons for taxation: raising revenue, discouraging consumption of demerit goods, reducing imports, redistributing income, influencing total demand, encouraging environmental sustainability
  • examples of the different classifications of tax: progressive, regressive, proportional; direct, indirect
  • impact of taxation on consumers, workers, producers/firms, the government and the economy

4.2.4—Definition of fiscal policy

  • Definition of fiscal policy

4.2.5—Fiscal policy measures

  • changes in:
  • taxes
  • government spending

4.2.6—Effects of fiscal policy on government macroeconomic aims

  • how fiscal policy measures may enable a government to achieve its macroeconomic aims

Objective notes

6 learning objectives
ConceptIGCSE Economics